{"id":556676,"date":"2026-03-22T09:00:14","date_gmt":"2026-03-22T09:00:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/556676\/"},"modified":"2026-03-22T09:00:14","modified_gmt":"2026-03-22T09:00:14","slug":"could-ai-make-university-degrees-less-valuable","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/556676\/","title":{"rendered":"Could AI make university degrees less valuable?"},"content":{"rendered":"

March 22, 2026 \u2014 4:45pm<\/p>\n

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Getting a university degree has long been seen as a ticket to a decent-paying job, even if that link has been increasingly questioned in recent years.<\/p>\n

But what if artificial intelligence fundamentally changes this equation, and degrees become less likely to secure white-collar work?<\/p>\n

\"WillWill more educated workers command a premium in an AI world?Andrew Quilty<\/p>\n

As companies everywhere rush to exploit AI, one of Labor\u2019s top economic minds, Dr Andrew Leigh, explored this and some other big economic questions posed by the AI craze in a speech last week.<\/p>\n

It left me thinking that even if the doomsday \u201cjobpocalyse\u201d scenarios of mass lay-offs don\u2019t come true, we can be pretty sure that AI will have all sorts of other effects on the labour market, particularly for people in white-collar jobs.<\/p>\n

AI-driven job cuts have become all too real lately, as tech giants such as Atlassian, WiseTech and Block have brutally swung the axe<\/a>. More employers will inevitably follow suit, so it\u2019s understandable that much of the AI discussion is about whether we\u2019re heading for a dystopian future where the robots take over humans\u2019 jobs, causing untold economic and social misery.<\/p>\n

Related Article\"Natalie<\/a><\/p>\n

Leigh, assistant minister for productivity competition, charities and treasury, is at the more optimistic end of this debate and believes the \u201cjobpocalypse\u201d scenario is unlikely, though the truth is that no one really knows.<\/p>\n

But the main point he made was that AI is already affecting some key economic theories about the world of work and labour markets.<\/p>\n

First, there\u2019s much debate about which workers will be the winners and losers in an AI world.<\/p>\n

Economists have long grappled with questions of how technology can affect people\u2019s pay, and the distribution of income more generally. One popular theory that appeared to explain why some workers make more than others is the idea that big technological changes tend to help people who are more skilled, while hurting people who are less skilled.<\/p>\n

\"AssistantAssistant Minister for Productivity, Competition, Charities and Treasury Andrew Leigh.Ben Appleton<\/p>\n

For example, the rise of computers was good for the partner of the law firm because it allowed the business to run more efficiently, but it didn\u2019t help people who used to work as typists. In this theory, there\u2019s a \u201cpremium\u201d paid to people who are more educated, skilled and able to use the new technology.<\/p>\n

However, Leigh suggests this dynamic is less clear with AI. Instead, he says, there\u2019s some evidence that AI can raise productivity disproportionately for lower-performing workers in the office, such as by helping people deliver better written reports.<\/p>\n

If the machines start doing more of this sort of work, Leigh suggests the more important distinction in the future might be whether someone can show judgment, as opposed to technical skill.<\/p>\n

\u201cRather [than] the formal skill categories, such as school completion, vocational qualifications and university degrees, the more relevant distinction in the future might be differences in the type of cognition performed,\u201d he says.<\/p>\n

\u201cPotentially, the significant distinction might be judgment versus execution, oversight versus production, or conceptual reasoning versus procedural cognition.\u201d<\/p>\n

What might this mean in practical terms?<\/p>\n

Well, it could mean people in \u201cjudgment-intensive\u201d roles are in high demand, such as \u201cthe partner who signs the opinion, the surgeon who leads the procedure, the engineer who approves the plan, the judge who authors the decision\u201d.<\/p>\n

Leigh suggests it could also mean that employers look for \u201cjudgment\u201d rather than technical skills \u2013 coding would be the most obvious example of a technical skill that\u2019s been seriously threatened by AI. How does an employer test if someone\u2019s got judgment? Perhaps through application tests, or by watching people on the job.<\/p>\n

Another big economic idea that\u2019s being challenged by AI is the idea of \u201chuman capital\u201d \u2013 a theory that says people\u2019s investment in education and training raise their productivity, thereby lifting future earnings.<\/p>\n

Related Article\"Crafton<\/a><\/p>\n

Measuring \u201chuman capital\u201d precisely isn\u2019t really possible, but economists have used proxies such as university degrees, and the grades people get at uni. However, AI systems that can help to write people\u2019s essays for them have clearly changed that equation.<\/p>\n

\u201cHistorically, educators could treat student output as evidence of accumulated knowledge. When AI mediates that output, the inference becomes less reliable,\u201d Leigh says.<\/p>\n

A possible consequence of this, once again, is that degrees may become a weaker signal to a prospective employer that a person has studied hard and developed their skills in thinking, analysing or writing.<\/p>\n

Putting all this together, it\u2019s difficult to avoid the conclusion that AI is going to make it harder for people to get a start in those entry-level jobs that allow you to get a start. After all, the best way to demonstrate sound judgment to an employer is probably by working for them and showing you\u2019re competent.<\/p>\n

I\u2019d also add another risk that economists should be thinking about: will AI make the world a more unequal place by diverting more income to the owners of capital, as opposed to people-paid wages?<\/p>\n

That certainly seems plausible. After all, AI really refers to high-tech machines owned by companies \u2013 just like machinery in factories. If AI can do some of the work done by people, businesses inevitably have the incentive to roll out these machines more widely and thereby increase their profits.<\/p>\n

Importantly, none of this is certain, and history has shown that new technologies eventually create new jobs, as well as destroying some.<\/p>\n

Another economist in Labor\u2019s Treasury ministry, Assistant Treasurer Dr Daniel Mulino, last week painted a more optimistic picture. He said that that over the past 150 years, roughly two thirds of GDP has gone to labour and one third has gone to capital, and these shares have been \u201crelatively stable\u201d. Labour force participation had also increased over this period.<\/p>\n

What\u2019s more, he noted, this had generally happened through all manner of technological upheaval, from the mechanisation of agriculture to the IT revolution of the late 20th century.<\/p>\n

Related Article\"Thousands<\/a><\/p>\n

Mulino was also careful not to make any predictions, but he did say these trends suggest that \u201cwith a bit of regulation and perhaps with a bit of prodding, we might imagine that we can see a plausible benign outcome on at least some fronts from AI, even if it is transformative\u201d.<\/p>\n

Ultimately, we are all in the dark about where precisely AI is taking us. But it seems inevitable that it will have major and sweeping effects for the labour market, and for the skills that employers value. Hang on for the ride.<\/p>\n

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning<\/a>.<\/p>\n

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\"ClancyClancy Yeates<\/a> is deputy business editor. He has covered banking and financial services, and was previously national business correspondent in the Canberra bureau.Connect via X<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"March 22, 2026 \u2014 4:45pm Save You have reached your maximum number of saved items. Remove items from…\n","protected":false},"author":2,"featured_media":556677,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[256,254,255,64,63,105],"class_list":{"0":"post-556676","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-au","12":"tag-australia","13":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/556676","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=556676"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/556676\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/556677"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=556676"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=556676"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=556676"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}